Complainant

Respondent

Anonymised Parties

A clerical officer

A transport company

Act

Complaint/Dispute Reference No.

Date of Receipt

Complaint seeking adjudication by the Workplace Relations Commission under Section 39 of the Redundancy Payments Act, 1967

CA-00017536-001

20/Feb/2018

The complainant commenced employment on a temporary contract on January 1st 2015 and it was renewed on a number of occasions. On October 9th 2017, he was notified that his employment would be terminated on October 31st. His complaint is that, despite several requests, he did not receive a redundancy payment.

On the date of the termination of his employment on October 31st 2017, the complainant had worked with the respondent for more than two years. On this basis, he argues that he is entitled to a redundancy payment. He said that, following his departure, during the month of November 2017, he sent two e mails to the Acting Chief Human Resources Officer, but he didn’t receive a reply. He got advice about the matter and completed a Form RP77, which is the official form to claim a redundancy lump sum when an employer had not paid redundancy.   The complainant delivered this by hand to the head office of the respondent company. He still received no response.

While he was disappointed to be let go by the respondent, the complainant makes no argument about the rationale for terminating his employment. He simply claims his entitlement to a redundancy payment.

For the respondent, the Chief Human Resources Officer explained why the complainant was made redundant. In 2015, the company was insolvent and on April 23rd 2016, following a referral to the Labour Court, the unions accepted a recommendation that 200 jobs would be made redundant, of which 40 were clerical roles. The rationale behind the redundancies is not specifically relevant to this claim.

The Chief Human Resources Officer apologised for not replying to the e mails sent by the complainant and he said that it was his view that people on fixed-term contracts were not entitled to redundancy payments in the same manner as permanent employees.

In response to the complaint being investigated, the Chief Human Resources Officer said that a new project was about to commence in the company and that there may be a suitable role for the complainant commencing on June 1st. This was another fixed-term contract with the possibility that it may become permanent. The complainant agreed to consider the role and to contact a member of the project team for a discussion.

On April 30th, the complainant wrote to me to confirm that he did not wish to take up the offer as he felt that the job was at a lower level than appropriate for his skills and experience.

The Relevant Law

Where a fixed-term contract is terminated, the employee can be made redundant if the termination falls into the classification of redundancy set out in section 7 of the Redundancy Payments Act 1967 – 2014. In summary, redundancy is defined as circumstances where:

(a) The business has closed or the place where the business was carried out has changed;

(b) There is a requirement for fewer employees in the business or at the place where the business was carried out;

(c) The employer has decided that the work that that was done by the employee could be done by fewer or no employees;

(d) The job will be done in future by a person who is more qualified or trained than the employee;

(e) The job will be done by a person who is also capable of other work that the employee is not qualified or trained to do.

It is clear from what was stated at the hearing, that the complainant’s job was redundant because the employer decided to carry on the business with less employees. As he had completed 104 weeks’ service, the complainant is eligible for a statutory redundancy payment.

As an employee on a fixed-term contract, the complainant’s employment was governed by the provisions of the Protection of Employees (Fixed-term Work) Act 2003. Section 6(1) of the Act provides that,

“Subject to subsections (2) and (5), a fixed-term employee shall not, in respect of his or her conditions of employment, be treated in a less favourable manner than a comparable permanent employee.”

Subsection (2) provides that a fixed-term employee may be treated in a less favourable manner compared to a permanent employee if that treatment can be justified on objective grounds.

Subsection (5) provides that a fixed-term employee who works less than 20% of the hours of a comparable permanent employee, may be excluded from the pension scheme that applies to the permanent employee.

Section 5(1)(a) of the Act sets out a definition of a “comparable permanent employee:”

“For the purposes of this Part, an employee is a comparable permanent employee in relation to a fixed-term employee if—

(a) the permanent employee and the relevant fixed-term employee are employed by the same employer or associated employers and one of the conditions referred to in subsection (2) is satisfied in respect of those employees…”

Section 5(2) sets out the conditions that are referred to in 5(1)(a) above:

“(a) both of the employees concerned perform the same work under the same or similar conditions or each is interchangeable with the other in relation to the work,

(b) the work performed by one of the employees concerned is of the same or a similar nature to that performed by the other and any differences between the work performed or the conditions under which it is performed by each, either are of small importance in relation to the work as a whole or occur with such irregularity as not to be significant, and

(c) the work performed by the relevant fixed-term employee is equal or greater in value to the work performed by the other employee concerned, having regard to such matters as skill, physical or mental requirements, responsibility and working conditions.”

The effect of this legislation is, that a fixed-term worker, in respect of their conditions of employment, must not be treated less favourably than a permanent employee, unless there are objective reasons for doing so. The entitlement to a redundancy lump sum, and the method of calculation of the lump sum, must apply to fixed-term workers in the same manner as it applies to permanent employees. Apart from his status as a fixed-term worker, no objective grounds were put forward by the respondent for not paying a redundancy lump sum to the complainant.

Findings

The complainant was recruited in the first instance to support a project which was also worked on by permanent employees. He subsequently filled in for permanent employees who were on leave of one sort or other and it was evident at the hearing that:

1. He performed the same work under the same conditions as permanent employees;

2. The work he did was the same or of a similar nature to the work done by the permanent employees with whom he worked; and,

3.   The work he carried out was equal in value to the work done by permanent employees that he worked with.

Conclusion

The entitlement to a statutory redundancy payment is governed by the Redundancy Payments Acts and the complainant is eligible for a redundancy payment because his employer decided that the work that he was employed to do should be done by fewer employees and because he completed more than 104 weeks of service with the respondent.

In accordance with the Protection of Employees (Fixed-term Work) Act 2003, the complainant cannot be treated less favourably compared to a permanent employee in respect of his conditions of employment. The entitlement to an enhanced redundancy payment, often referred to as an “ex gratia” payment, is a condition of employment in the respondent’s business.   It follows therefore that the complainant is entitled to the enhanced redundancy payment that applies to permanent employees.

As I have concluded that this complaint is well-founded, I have decided that the respondent is to pay the complainant a redundancy lump sum calculated on the same basis as that which applied to eligible permanent employees on the date of the termination of the complainant’s employment, October 31st, 2017.

Fixed-term workers, redundancy